Abbey National expects mortgage lending in the UK to exceed the record levels set last year.
In a briefing note the lender said: ‘Although the early months of the year tend to be quiet in the housing market, the indications are that the high pace of activity seen in the second half of last year has continued. This is despite the standstill in overall economic growth in the final quarter of last year and signs of unemployment starting to rise.’
Last year gross mortgage lending at Abbey National reached a record £160bn, up 34% on the year. It feels this increase reflected four factors: higher house prices, increased remortgage activity, increased equity withdrawal (as home owners took advantage of the higher values of their properties), and a pick-up in turnover.
The note said: ‘The strength of the mortgage market last year stood in complete contrast to the doom and gloom about global recession and has shown no real sign of weakening so far.’
Abbey National had previously expected that UK net lending would slip to £51bn this year, down from the £54bn record last year.